SINGAPORE, Thursday, August 29, 2024- Indian cryptocurrency exchange WazirX has requested a six-month moratorium from the Singapore High Court following a $234 million hack in July.
The court filing seeks protection while the company restructures its liabilities and develops a recovery plan for users affected by the cyberattack.
WazirX’s Singapore-incorporated parent, Zettai Pte, stated that the moratorium would allow the company to address users’ cryptocurrency balances efficiently.
The court’s automatic 30-day moratorium began on August 27, shielding WazirX from immediate legal actions.
CoinSwitch, a rival crypto platform, has announced plans to pursue legal action to recover $9.6 million in deposits held on WazirX.
The company expressed frustration over unproductive recovery efforts, stating that litigation has become the only viable option.
WazirX co-founder Nischal Shetty filed an affidavit supporting the application, which includes a proposal to allocate the impact of the hack pro-rata among users. The plan will treat all users equally as unsecured creditors, distributing available assets in proportion to their claims.
The filing also revealed WazirX is exploring rescue financing options. Talks with 11 potential partners are underway, although some have raised concerns about the legal uncertainties surrounding the case.
As of August 24, WazirX had frozen withdrawals and reported holding $284 million of the original $570 million in user balances. The exchange has set aside $12 million for investigations and legal costs.
The court has yet to schedule a hearing for the extended moratorium.
